Bitcoin FAQ: could this be the beginning of a classic bubble? A bit like tulips in the 1600s?

I have a question: could this be the beginning of a classic bubble? A bit like tulips in the 1600s.

The bubble argument, thank you Matt I’ve been waiting for this one.

Comparing Bitcoin to tulips is stupid because tulips are replicable, degradable, and difficult to value. But I’ll humour the “bubble” argument for a second. Bitcoin needs to have a certain market cap to facilitate transactions of value, being open source, distributed and not owned by anybody/anything bitcoin needs to somehow grow from $0 market cap, to a much much much higher market cap. The people that say bitcoin is in a “bubble” think bitcoin can magically have enough value to work, without growth.

All major stocks go through periods of parabolic growth prior to IPO, it’s just that never before have lowly people like us had exposure to the massive pre-IPO growth period of a company or company owned technology. Twitter, Instagram, Facebook and many others all had parabolic growth in user numbers, it’s just they weren’t publicly traded at the time so the financial implications weren’t readily visible.

If 10 rats land on a deserted island, their population will grow parabolically until they reach saturation – watch this:

The “volatility” argument falls into the same bracket – how can a new technology grow to a point of stability and saturation without volatility? it’s impossible.